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Reliance Goes Off-shore

Rel-MF seeking to gain new grounds on the atlas

With its eyes set on exploring opportunities across the spectrum of activities in the financial world, Reliance Mutual Fund, one of the country’s leading mutual funds will be winging its way to a foreign country, Malaysia, to start with.

This is nothing new the fund is attempting, it is merely following in the jet-stream of its predecessors that includes other Indian financial organizations and banks. While SBI Mutual Fund has already introduced a Shariah compliant off-shore fund under ‘SBI Resurgent India Opportunities Fund’ (RIDF), Taurus applied market regulator SEBI to come out with a similar product.

Similarly ‘UTI Mutual Fund’ already has an ‘off-shore Shariah Compliant Fund after which they are are planning to launch a domestic Shariah Fund.

The concept is fast gaining popularity in India too. To name a few of the participants, Benchmark Mutual Fund, Taurus Mutual Fund and a few other banks have already launched their Islamic-variant funds. On the global scale, the US’ Dow Jones Index has already licensed the Dow Jones Islamic Market (DJIM) India Index to HSBC Asset Management India Limited to serve as a benchmark of an actively managed portfolio. Amongst other well known indices are the S&P 500 Shariah, S&P Europe 350 Shariah, S&P Japan Shariah and FTSE Shariah Japan 100.

The lure for Reliance MF in Malaysia is the huge Indian diaspora, albeit settled there for hundreds of years, especially a segment of that population that has not been provided the kind of financial instruments that it really needs, as per its beliefs. With Muslims as the target, the numbers are attractive, both financial and population-wise. Reliance has chosen Kuala Lumpur as the office set-up centre.

Said Sundeep Sikka, CEO of Reliance Capital Asset Management, “A subsidiary has been set up and it will be unveiling an Islamic fund shortly.”

The move comes almost 6 months after Reliance Capital, along with Kuwait’s Global Investment House, was given the green signal last November by the Securities Commission of Malaysia to establish their Islamic fund management operations.

Taking one step at a time, the company has already set up a subsidiary and plans to unveil its fund soon, top Reliance Capital Asset Management officials pointed out.

That Reliance has chosen to follow the trend, many financial organizations and banks have unveiled their offerings to lure Muslim populations in other countries, indicates its strong belief in the segment being a viable one to deliver good returns over a long period of time.

Also see:
Reliance Hops Onto Infra Bandwagon